Western Cape: Buyers paying 20-40% premiums to be near good schools
By now, it is well known that the Western Cape has come out tops in the country for matric passes this year. No less than 27 schools obtained a 100% matric pass rate for the fifth consecutive year. The Cape is of course renowned for its excellent selection of private and government schools, not just in the upmarket suburbs, but in or close to just about every neighbourhood across the metro and the surrounding areas.
That, says Samuel Seeff, chairman of the Seeff group, is one of the key driving factors for the housing market. Even buyers that migrate to the city from areas such as Johannesburg tend to be drawn to suburbs and areas with excellent schools.
The competition for space in schools, not just private, but also government schools is such that there is tremendous demand for homes close to or within the catchment areas of good schools. So much so, that buyers are often prepared to pay a premium of 20%-40% for such a property, says Seeff.
The desire to live close to schools is also something that cuts across the demographics as most parents, regardless of their income bracket, now want to reside within the catchment area of a good school. And, as noted above, there is no shortage of good schools across the metro and surrounding area.
Western Cape boasts excellent private and public schools
When we look at the list of 27 schools that obtained a 100% matric pass rate, we note that these are not just schools located in the R5-R10 million-plus suburbs either, but also in the middle class areas such as Parklands and Sunningdale in the Blouberg area along with Strand as well as in Boland towns such as Paarl and Stellenbosch and even in country towns such as Bonnievale and Riversdale.
It generally does not matter where you buy when it comes to the Cape as you are likely to be within relatively close proximity to a good school, says Seeff.
The southern suburbs residential belt that stretches from Rosebank and Rondebosch to Tokai for example boasts about 160 schools in all, the highest concentration in the country. According to Seeff’s licensee for the area, James Lewis, it therefore comes as no surprise that the area is home to no less than ten of the schools that boast a 100% pass rate for 2015.
Rondebosch tops the list with five schools in the area that boast a 100% pass rate, namely Bishops, Rondebosch Boys’ High, Vista Nova High, Rustenburg Girls’ High (in neighbouring Rosebank) and Star International High School in the Sybrand Park area.
Charmaine Scott-Wilson, agent for the neighbourhood says that there are about 16 private and government schools in the Rondebosch area alone. Aside from the high concentration of schools, there is also the University of Cape Town that adds to the high demand for homes here.
The demand for a home near a school or close to the university is now such that there are now almost no houses on offer below the R3 million price band. Even those priced to around R6 million are snapped up quite rapidly and seldom need to be advertised according to the agent.
We battle to keep up with the demand, especially during the early part of the year and it is still an excellent period for sellers here, she adds. Houses close to top schools such as Bishops can now sell for upwards of R8 million to R12 million. Given the excellent performance of school in the area, she expects the market to remain resilient despite what is set to be a rather challenging year ahead.
Neighbouring Newlands is home to two of the top performing schools, Sans Souci Girls’ High and Westerford High. Aside from the schools and close proximity to UCT, demand for homes in the area and property values are also influenced by its location close to the city and the fabulous Table Mountain views. The suburb is of course also home to the historic Newlands cricket and rugby grounds.
Add to that the village vibe and stunning homes set in beautiful old oak-tree lined streets. It is now quite common for homes here to regularly sell for upwards of R5 million to as much as R15 million. Here too, there is now almost nothing to buy under R3 million in terms of freehold houses and it remains a good phase for sellers.
Other top schools in the area that have made the 100%-pass rate list include Herschel Girls’ School in Claremont, Springfield Convent in Wynberg and of course Constantia Waldorf School, says Lewis.
The top performing pupil in the country was also a Capetonian from SACS (South African College Schools), based in Newlands.
Schools in affordable areas
Pinelands meanwhile is another suburb that boasts a top school, Cannons Creek, along with Pinelands High which also boasted excellent results last year. There are also three junior schools according to Johan Meyer, licensee for the area who says that the suburb is very popular with family buyers, with younger buyers now moving here in greater numbers.
Unlike the neighbouring southern suburbs, Pinelands though still offers plenty of homes in the R2.5 million to R4 million price bands. Some 60% of all sales over the last year were in fact still below the R3 million price mark according to Meyer.
Another area where the prevalence of top schools is a major driver of the demand for property is the Blouberg area. According to Wouter Pentz, Seeff’s licensee for the area, it is not just the sought-after seaside lifestyle and excellent facilities and infrastructure that draws buyers, but families are particularly drawn to the top schools and facilities on offer that cater for families and children.
There are for example about 20 schools, including a number of private schools. Three schools in the area made it to the top pass rate list, being Parklands College, CBD St John’s and Elkanah House.
Pentz believes that here too, demand is likely to remain high as the area is still seen as very affordable despite the excellent price growth over the last few years. You can for example still find a nice family house for around the R1.2 million to R1.6 million price mark. There is also an excellent selection of new homes with stunning finishes that are still selling for under R2.3 million.
Aside from freehold homes, the area is renowned for its many security complexes that offer an excellent selection of homes suitable to families. Luxury buyers too have plenty to choose from in the R5 million to R10 million range with homes close to the beach now priced to around R20 million.
No matter which suburb you choose in the Blouberg area, you are likely to be close to a good school according to Pentz. The area is on the whole well suited to families with excellent facilities. There are many green belt areas, sport facilities, a soccer club and just about every amenity that families could want for. Add to that the beach area that now even includes an outdoor gym similar to the one on the Sea Point promenade.
The Strand too boasts excellent schools with at least two making the 100%-pass rate list (Natural Learning Academy and Valsbaai High according to Alten Vermaak, manager and agent for the branch. Here too, it is the relaxed seaside lifestyle and top class facilities and infrastructure that draws buyers, not to mention the affordability. You can for example still find a nice family home for around the R1.2 million to R2.2 million price mark.
Top end buyers looking for more space, luxury finishes and added extras such as a sea view or golf estate location though also still have plenty to choose from as there is now a superb selection of top end homes priced to around R10 million, says Vermaak.
Boland and country towns
The Boland towns of Paarl, Stellenbosch and Worcester also boast top end schools that have made the 100% matric pass rate list. This includes Boland Landbouskool, La Rochelle and Paarl Girls’ High in Paarl along with Bloemhof and Rhenish Girls’ High Schools in Stellenbosch and Pioneer School in Worcester.
Five of the Cape’s country towns also made the list of top schools. These are Bonnievale, Heidelberg, Lutzville, Riversdale (Oakdale Landbouskool) and Porterville.
Aside from good schools, the Cape property market is also buoyed by a number of factors according to Seeff. Top of the list is the location, mountains, sea and vineyards. The city and surrounds are well run and administered with clean neighbourhoods and concerned citizens, many of whom take an active interest and contribute to additional safety measures such as a local neighbourhood watch and the improvement district initiatives.
For the Cape metro alone, some 6000 property sales worth about R18 billion were recorded for the 2015 year according to the latest Propstats data. That equates to about 15 transactions worth about R50 million every day of the year, says Seeff.
While not immune to economic challenges and certainly set for a challenging year ahead, Seeff expects the Cape property market to continue its solid performance. High demand areas, including those with top schools, are likely to continue seeing strong demand and good prices for sellers, provided they remain realistic with their price expectations.